Alcoa (AA)
NYSE:AA
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Alcoa
(NYSE:AA)
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Rating:69Neutral
Price Target:
$69.00
▲(5.15% Upside)
Action:Downgraded
Date:05/12/26
The score is driven primarily by improved profitability and a very strong balance sheet, supported by a low P/E valuation. Offsetting these positives are weaker cash conversion and recent negative free cash flow, along with soft technical momentum and near-term alumina/cost headwinds discussed on the earnings call.
Positive Factors
Very strong balance sheet
Extremely low reported leverage and a large equity base provide durable financial flexibility to fund operations, capex and opportunistic deleveraging. This reduces refinancing risk, supports capital allocation choices and cushions the company against cyclical commodity swings over the next 2–6 months.
Negative Factors
Pronounced revenue cyclicality and recent decline
The business remains highly cyclical and revenue can swing dramatically with commodity markets and third‑party alumina demand. Large top‑line volatility undermines predictability of margins and cash generation and raises execution risk for medium‑term planning and investments.
Read all positive and negative factors
Positive Factors
Negative Factors
Very strong balance sheet
Extremely low reported leverage and a large equity base provide durable financial flexibility to fund operations, capex and opportunistic deleveraging. This reduces refinancing risk, supports capital allocation choices and cushions the company against cyclical commodity swings over the next 2–6 months.
Read all positive factors
Alcoa Key Performance Indicators (KPIs)
Any
Sales by Segment
Breaks down revenue from each business unit, offering insights into which segments are performing well and contributing most to overall growth.
Breaks down revenue from each business unit, offering insights into which segments are performing well and contributing most to overall growth.
Data provided by:
The Fly
The FlyAlcoa (AA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$16.50B
Dividend Yield0.75%
Average Volume (3M)6.00M
Price to Earnings (P/E)10.3
Beta (1Y)1.71
Revenue Growth0.51%
EPS Growth17.91%
CountryUS
Employees13,900
SectorBasic Materials
Sector Strength58
IndustryAluminum
Share Statistics
EPS (TTM)4.01
Shares Outstanding263,889,860
10 Day Avg. Volume5,234,303
30 Day Avg. Volume5,995,325
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)2.27
Price to Sales (P/S)1.09
P/FCF Ratio24.45
Enterprise Value/Market Cap1.06
Enterprise Value/Revenue1.39
Enterprise Value/Gross Profit10.78
Enterprise Value/Ebitda10.17
Forecast
1Y Price Target
$72.04Price Target Upside9.79% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering10
EPS Forecast (FY)7.2
Revenue Forecast (FY)$14.83B
Alcoa Business Overview & Revenue Model
Company Description
Alcoa Corporation, together with its subsidiaries, produces and sells bauxite, alumina, and aluminum products in the United States, Spain, Australia, Iceland, Norway, Brazil, Canada, and internationally. The company operates through three segments...
How the Company Makes Money
Alcoa makes money primarily by producing and selling aluminum value-chain commodities—bauxite, alumina, and primary aluminum—earning revenue based largely on sales volumes and market-linked pricing.
Key revenue streams:
1) Primary aluminum sales:...
Alcoa Earnings Call Summary
Earnings Call Date:Apr 16, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 22, 2026
Earnings Call Sentiment Positive
The call conveyed solid operational execution and a strong sequential improvement in profitability and adjusted EBITDA, supported by higher aluminum prices (LME ~+10% sequential) and effective commercial and logistics actions (San Ciprián restart, inventory repositioning, and growing value-add demand). At the same time, the Alumina segment faces pronounced near-term headwinds—third-party alumina revenue declined 33% and alumina EBITDA fell—while free cash flow was negative $298 million and environmental/ARO cash needs were increased. The company highlighted disciplined capital allocation, a robust cash balance ($1.4 billion), and active deleveraging (notice to redeem $219 million of 2028 notes), which temper the risks. Overall, the positives around earnings, EBITDA expansion, commercial momentum for value-add products, and balance sheet actions slightly outweigh the operational and cash-flow headwinds tied chiefly to alumina and working capital timing.Positive Updates
Strong Sequential Profitability Improvement
Net income attributable to Alcoa Corporation increased to $425 million from $213 million sequentially (~+100%), with diluted EPS rising to $1.60. Adjusted net income was $373 million, or $1.40 per share, excluding $52 million of net special items.
Negative Updates
Revenue Decline and Weak Alumina Sales
Total revenue decreased 7% sequentially to $3.2 billion. Alumina third-party revenue fell sharply by 33% in Q1 due to seasonally lower shipments, lower purchased/resold alumina, vessel constraints tied to the Middle East conflict, and cyclone-related loading issues in Western Australia.
Read all updates
Q1-2026 Updates
Positive
Negative
Strong Sequential Profitability Improvement
Net income attributable to Alcoa Corporation increased to $425 million from $213 million sequentially (~+100%), with diluted EPS rising to $1.60. Adjusted net income was $373 million, or $1.40 per share, excluding $52 million of net special items.
Read all positive updates
Company Guidance
Alcoa updated its 2026 guidance with several key numeric adjustments: interest expense is now expected to be about $135 million following the announced May redemption of $219 million of 2028 notes, and environmental and ARO cash payments were raised to ~ $360 million (from $325 million); at the segment level Alumina is expected to be unfavorable by roughly $15 million (about $10M from lower bauxite offtake price/volumes and additional diesel/energy pressure) while Aluminum is expected to be favorable by about $55 million (including ~ $30M benefit from Q1 inventory repositioning, ~ $35M from higher shipments and product premiums, ~ $10M from lower production costs after the San Ciprián restart, partially offset by ~ $20M of seasonally lower third‑party energy sales); additional guidance items include an expected ~$35M increase in Section 232 tariff costs on Canadian metal imports, alumina costs in Aluminum expected to be favorable by ~$20M, a below‑EBITDA currency tailwind of ~ $30M (may not recur), operational tax expense modeled at ~$110–120M, a maintained 2026 capex outlook after Q1 capex of $119M, and balance‑sheet/cash metrics of $1.4B cash, adjusted net debt of $1.8B, Q1 adjusted EBITDA of $595M, and negative free cash flow of $298M.Alcoa Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
88
Very Positive
Cash Flow
56
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 12.65B | 12.74B | 12.18B | 10.71B | 12.76B | 12.44B |
| Gross Profit | 1.63B | 1.73B | 1.50B | 241.00M | 1.93B | 2.62B |
| EBITDA | 1.73B | 1.86B | 1.09B | 155.00M | 1.43B | 2.06B |
| Net Income | 1.02B | 1.15B | 60.00M | -651.00M | -123.00M | 429.00M |
Balance Sheet | ||||||
| Total Assets | 16.64B | 16.13B | 14.06B | 14.15B | 14.76B | 15.03B |
| Cash, Cash Equivalents and Short-Term Investments | 1.38B | 1.74B | 1.14B | 944.00M | 1.36B | 1.81B |
| Total Debt | 2.44B | 2.75B | 2.82B | 1.97B | 1.87B | 1.87B |
| Total Liabilities | 9.75B | 9.94B | 8.91B | 8.31B | 8.17B | 8.74B |
| Stockholders Equity | 6.83B | 6.12B | 5.16B | 4.25B | 5.08B | 4.67B |
Cash Flow | ||||||
| Free Cash Flow | 287.00M | 567.00M | 42.00M | -440.00M | 342.00M | 530.00M |
| Operating Cash Flow | 931.00M | 1.19B | 622.00M | 91.00M | 822.00M | 920.00M |
| Investing Cash Flow | -523.00M | -502.00M | -608.00M | -585.00M | -495.00M | 565.00M |
| Financing Cash Flow | -278.00M | -261.00M | 201.00M | 57.00M | -768.00M | -1.16B |
Alcoa Technical Analysis
Positive
65.62
Price Trends
63.68
Positive
58.46
Positive
45.78
Positive
Market Momentum
2.25
Positive
47.07
Neutral
26.52
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AA, the sentiment is Positive. The current price of 65.62 is below the 20-day moving average (MA) of 66.53, above the 50-day MA of 63.68, and above the 200-day MA of 45.78, indicating a neutral trend. The MACD of 2.25 indicates Positive momentum. The RSI at 47.07 is Neutral, neither overbought nor oversold. The STOCH value of 26.52 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AA.
Alcoa Risk Analysis
Alcoa disclosed 28 risk factors in its most recent earnings report. Alcoa reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Alcoa Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $11.83B | -164.09 | 11.04% | 0.07% | 56.81% | 525.85% | |
69 Neutral | $16.50B | 10.29 | 16.13% | 0.75% | 0.51% | 17.91% | |
68 Neutral | $5.62B | 4.30 | 40.62% | ― | 7.54% | 183.70% | |
68 Neutral | $4.34B | 4.18 | 47.75% | ― | 20.15% | 583.93% | |
64 Neutral | $7.90B | 21.86 | 11.88% | 1.02% | 8.38% | 626.64% | |
64 Neutral | $2.77B | 7.83 | 18.68% | 2.64% | 20.84% | 247.80% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% |
* Basic Materials Sector Average
AA
Alcoa
62.53
33.45
115.01%
CENX
Century Aluminum
56.82
40.54
249.02%
CMC
Commercial Metals Company
71.25
24.07
51.01%
HL
Hecla Mining Company
17.64
12.71
257.74%
KALU
Kaiser Aluminum
169.29
98.52
139.23%
CSTM
Constellium
31.91
19.75
162.42%
Alcoa Corporate Events
Business Operations and StrategyExecutive/Board ChangesShareholder Meetings
Alcoa Shareholders Approve Expanded Incentive Plan, Reelect Board
Positive
May 11, 2026
At its Annual Meeting on May 6, 2026, Alcoa’s stockholders approved an amended and restated Stock and Incentive Compensation Plan that expands the share pool from 30 million to 38 million and extends the plan’s term to May 6, 2036. The...
Private Placements and FinancingRegulatory Filings and Compliance
Alcoa Details New Material Agreement and Related Debt Obligations
Neutral
May 4, 2026
Alcoa disclosed that information related to its entry into a material definitive agreement, reported under Item 1.01 of a Current Report on Form 8-K, is being incorporated by reference into Item 2.03 of the same filing. This technical, cross-refer...
Business Operations and Strategy
Alcoa Redeems 2028 Notes, Enhancing Balance Sheet Flexibility
Positive
Apr 14, 2026
On April 14, 2026, Alcoa said its subsidiary Alcoa Nederland Holding B.V. has elected to redeem in full its outstanding 6.125% notes due 2028, totaling about $219 million in principal. The notes, guaranteed on a senior unsecured basis by Alcoa and...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.